Systems and methods for providing loan management from cash or deferred income arrangements

ABSTRACT

The method comprising: administering a first plurality of loan fund accounts; maintaining an association of each different one of the first plurality of loan fund accounts with a different investment vehicle that is part of the respective benefit plan account; receiving a selection from a selecting entity of one or more loan fund accounts from among the first plurality of loan fund accounts; investing loan fund assets comprising participant assets associated with the selecting entity in the different investment vehicles associated with loan fund accounts; associating a respective loan accounting process with each of the selected loan fund accounts; receiving a loan-request; initiating transfer of an amount requested; and updating account information to reflect said loan-request funds transferred from said loan fund account.

RELATED APPLICATIONS

This application is a Continuation of U.S. application Ser. No.11/928,826, filed Oct. 30, 2007, incorporated herein by reference in itsentirety, which claims priority from Provisional Application U.S.Application 60/957,090, filed Aug. 21, 2007, incorporated herein byreference in its entirety. This application further incorporates byreference all of the subject matter of U.S. application Ser. No.10/092,279 filed on Mar. 6, 2002 and implemented in the Reserve Plusfinancial product by assignee prior to 2005 in its entirety and furtherincorporates by reference all of the subject matter of U.S. applicationSer. No. 10/183,661 filed Jun. 27, 2007 in its entirety.

FIELD OF THE INVENTION

The present invention generally relates to methods for providing andmanaging loan programs related to pension plans including qualifiedbenefit plans, or to employee-benefit plans, or to benefit plansgenerally. More particularly, this invention includes: processes forauthorizing and establishing pension related loan funds; processes forrepayment and redemption suitable for the wide variety of accessvehicles (check, credit card, debit card, wire transfer, ACH, sweeps,etc.) that may be coupled to the loan programs; processes fordischarging trustee responsibilities delegated by the related pensionfunds, such as proper regard for applicable laws, regulations, and planpolicies; as well as processes for program loan repayment and foraccounting for and reestablishment of such loan programs.

Preferably, the processes of the present invention are implemented byprogrammed computer systems in communication both with other financialmanagement entities having a role in the loan programs and with theloan-program participants.

BACKGROUND OF THE INVENTION

Employee-benefit programs, including employee pension programs includingqualified employee pension programs, have accumulated large amounts ofassets, by 1994 exceeding $1.75 trillion. For many individuals of lowand moderate income, their beneficial interests and assets in thesebenefit programs are their largest, or even their only, pool of capitaland savings.

These assets have traditionally been set aside for and limited toretirement income purposes only, and have not been effectively availableto help with the vicissitudes of life, such as higher education,purchase of a residence, temporary unemployment, unexpected medicalexpenses, and the like. But for those of low or moderate income, who maybe the most challenged by these life events, such limitations on thesemost significant assets can be a problem. Thus, lower income or lowerage persons have the perception that they cannot get their money out orborrow against their money efficiently.

Fortunately, statutory and regulatory developments provide possibilitiesfor ameliorating these asset-availability problems. Specifically, theynow permit benefit plans to establish policies and procedures for makingtemporary loans from individually-accumulated assets to their employeebeneficiaries. Theoretically, anyone who needs temporarily to tap theirbenefit-plan assets may do so by applying to their benefit plan.

But benefit-plan administrators to date have typically adoptedconventional paper-based procedures usually requiring an employeesubmission of a completed loan application for each separate loan,employer-plan approval of the loan application, and then employeesignature of a note with fixed installment-based terms to repay theborrowing to the plan. Many plans also require participants withoutstanding benefit-plan loans to repay the loans within a short periodof time (usually 90 days) after termination of employment, which isfrequently not convenient. For those most likely to need benefit-planloans, this process appears time consuming at best and intrusive,unfamiliar, and intimidating at worst.

The unfortunate consequences of these traditional procedures has been,on the one hand, that individuals of low and moderate income avoid planloans and instead rely on high interest rate credit cards for theirfinancing needs. On the other hand, if a plan loan is used, more fundsthan are immediately needed are usually removed from the benefit plans,due to the difficulty of the current process and the uncertainty of aparticipant's financial needs at the time of loan application, whichunnecessarily lowers future retirement income. In the worst case,employees eligible to participate in a retirement plan completely optout because of the perceived lack of liquidity, thereby losing theentire matching employer contribution and the advantages inherent inqualified benefit plans.

Proposals that have been made for simplifying the benefit-plan loanprocess have not enjoyed any commercial success thus far, principallybecause they have not adequately considered the current financialrecord-keeping systems of employee-benefit-plan providers. These currentrecord-keeping systems are structured to interact with employers andinvestment managers, not with the employees who are the beneficiaries.For example, U.S. Pat. No. 5,206,803, issued Apr. 27, 1993, describes asystem for providing pension-fund-backed credit to fund beneficiaries.But that system places all the burdens of processing employee creditdemands and of distributing funds on the pension plan itself.

There is clearly a need for methods and systems that simplify providingof employee-benefit-plan loans while respecting the functionality ofexisting benefit plans, financial mechanics, methods; and systems forproviding basic retirement income and other employee-benefit services.

Citation or identification of any reference in this section or anysection of this application should not be construed as indicating thatthe reference is available as prior art to the present invention.

SUMMARY OF THE INVENTION

The objects of the present invention are to overcome these deficienciesin the prior art by providing methods and systems that simplify theprovision of employee-benefit-plan loans while efficiently interactingwith the financial mechanics, methods, and systems of existingemployee-benefit services. Importantly, this invention appears to andinterfaces with employee-benefit plans (and to benefit plans generally)essentially as a plurality of investment vehicles to which the planparticipant may direct parts of their assets; it assumes allresponsibility for properly managing participant loans; and it furtherappears to and interfaces with a variety of access systems (check,credit card, debit card, wire transfer, ACH, sweeps, etc.) essentiallyas one more financial institution providing payment services inaccustomed fashions.

Loan management provided by the invention is, first of all, properlyprovided according to the statutory and regulatory context of thejurisdiction of employers, regulators, and employee beneficiaries.Although the detailed description is primarily directed to embodimentsfor the United States and its territories, it is to be understood, andone of skill in the arts will so understand, that the present inventionis not so limited. It also has embodiments that may be implemented inany jurisdiction providing, first, benefit plans for employees andothers, in which at least a part of the plan assets are specificallyallocated to individual plan participants and in which the individualplan participants have some discretion in the investment of theirspecifically allocated assets. Second, the jurisdiction must permitloans, or equivalent temporary disbursements, of part of thespecifically allocated assets for current employee use, either generalor limited. Additional embodiments may maintain explicit informationconcerning the jurisdictional management requirements so that suchembodiments may service employers in more than one jurisdiction. Thepresent invention will also meet any further statutory and regulatoryrequirements, such as privacy, information interchange,nondiscrimination, and the like.

In preferred U.S. embodiments, the invention's loan-management processespreserve the plan participant's qualifications according to 26 U.S.C. §401 et seq. (qualified pension, profit-sharing, and stock bonus plans),and more particularly according to 26 U.S.C. § 401(k) (cash or deferredarrangements). Although Section 401(k) plans are particularly preferred,the present invention may interface to other similar plans (for example,403(b) plans, 457 plans, individual retirement accounts [IRA], Keoughaccounts, and the like). Further, loan funding and disbursementpreferably meet the requirements of 26 U.S.C. § 72 (annuities; certainproceeds of endowment and life insurance contracts). Finally, in theU.S., the invention's loan-management processes preferably meet thereporting, fiduciary, and other requirements of 29 U.S.C. § 1001 et seq.(Employee Retirement Income Security Program) (ERISA). See, Gertner,1994, Everything You Always Wanted To Know About ERISA, InvestmentManagement Consultants Association, Denver, Colo.; Dearborn FinancialPublishing, Inc., 1999, 401(k) Plans 3^(rd) Edition, Dearborn FinancialPublishing, Inc., Chicago, Ill.

Loan management is also preferably provided according to the policiesand procedures that may be established by individual benefit plans. Forexample, a benefit plan may, by agreement, have specific policiesconcerning maximum loan amounts, maximum loan frequencies, maximum loanpayback periods, and the like. Such specific policies may further governemployee authentication methods, data privacy, and other managementprocesses. Accordingly, embodiments that interface with multiple benefitplans preferably maintain explicit information concerning each plan'spolicies and requirements so that such embodiments may service multipleplans.

Although primarily described in terms of qualified-employee-benefitplans and as loans from these plans meeting the requirements for notbeing deemed such distributions, in further embodiments the inventionmay allow participants to convert their loans into plan distributions.Further, the systems and methods of the present invention may also beadvantageously employed for loan funds related to employee-benefit plansthat are not qualified. In such embodiments, the invention'sloan-management methods need be primarily in accordance only with theplan's agreements and procedures, because meeting statutory andregulatory requirements for qualification at all times is unnecessary.

Finally, to realize full benefit of this invention, a jurisdictionpreferably should have in place electronically implemented paymentsystems with interfaces that permit adding systems of this invention asa financial institution providing payment services. Preferably, thisinvention may include interfaces to payment systems in which individualspresent access vehicles to their loan-fund account for ordering theredemption of a specified sum to a specified payee. These accessvehicles include checks, credit cards, debit cards, wire transfers, ACHservices, sweeps, and others. See O'Mahony et al., 1997, ElectronicPayment Systems, Artech House, Inc., Norwood, Mass.

More specifically, the present invention provides low-cost financing toemployee beneficiaries by simplified and routine access to a portion ofthe assets accumulated within their established benefit plans,especially pension benefit plans. This access is on an as-needed basis,by means of a variety of possible access vehicles (check, credit card,debit card, wire transfer, ACH services, sweeps, etc.), and withoutcumbersome paperwork. Importantly, selected embodiments of the systemsof the present invention interface efficiently to and work both withestablished employee-benefit-plan systems and administrations and alsowith established payment systems.

Methods of the present invention open, manage, and terminate a pluralityof loan funds, at least one for each benefit plan participant that takesadvantage of this invention. Importantly, these loan funds are managedindependently of the plan by the invention. Also, since they are legallyconsidered as employee investments, interest paid by plan participantson their outstanding loans (also called herein “redemptions”) isactually accrued (less fees) to their own benefit-plan accounts, thusreplacing high interest borrowing via bank cards for the participant.

The present invention further provides in one embodiment loan-managementdata-processing systems that interface and communicate with establishedbenefit-plan-management systems and with established payment systems.Embodiments of the loan-management data-processing systems cooperatewith these interfaced systems to open loan funds for a plan participant,provide for payment authorizations and redemptions from the loan funds,arrange funds transfers, provide repayment and status information toparticipants, and so forth. Thus, cumbersome paper procedures areminimized and participants can manage their loan funds according totheir daily needs.

In the following, the benefit plan may be known as the “main” benefitplan to distinguish it clearly from the loan fund, especially in thosealternative organization embodiments where the same financialorganization may offer benefit plan services, loan fund services, orloan fund investment management services.

In one embodiment, a method is provided to be implemented at least inpart by computer for facilitating provision of loans to a plurality ofparticipants of one or more benefit plan accounts associated with one ormore record keepers, each participant having participant assets in oneor more of the benefit plan accounts, each of the benefit plan accountscomprising a plurality of investment vehicles, each of the one or morerecord keepers providing record keeping services for at least one of thebenefit plan accounts, comprising: administering a first plurality ofloan fund accounts, each different loan fund account being associatedwith a respective one or more of the benefit plan accounts, and fundedby participant assets of the respective associated one or more of thebenefit plan accounts, referred to as loan fund assets, wherein fundsmay be drawn for loans from each of the different loan fund accounts,and wherein each of the loan fund accounts maintains both assets anddebts; maintaining an association of each different one of the firstplurality of loan fund accounts with a different investment vehicle thatis part of the respective one or more benefit plan accounts butsegregated from other investment vehicles in the respective one or morebenefit plan accounts; receiving a selection from a selecting entity ofone or more of the loan fund accounts from among the first plurality ofloan fund accounts; investing or having invested or maintaining loanfund assets comprising participant assets associated with the selectingentity in the one or more respective different investment vehiclesassociated with the one or more selected loan fund accounts; associatinga respective loan accounting process with each of the selected one ormore loan fund accounts, capable of processing multiple loan requeststhat are less than an asset balance in the loan fund account, whereinthe loan accounting process is different from one or more accountingprocesses associated with the respective one or more benefit plans;receiving a loan-request comprising one or more participant loanrequests to be taken from one or more of said loan fund accounts usingaccount information for said loan fund account; initiating transfer ofan amount of funds requested by said loan-request from one or more ofsaid loan fund accounts to service the loan-request; and updating bycomputer said account information for said loan fund account to reflectsaid loan-request amount of funds transferred from said loan fundaccount using the associated respective accounting process that computesa current balance of available funds in the loan fund account based onredemptions from the amount of assets in the loan fund account andpayments to the amount of assets in the loan fund account and does notchange a loan fund asset amount listed in the account information of thebenefit plan account relating to the loan fund account for eachredemption.

In further embodiment, the loan request comprises an aggregation of aplurality of loan requests from participants received in a period.

In further embodiment, the selecting entity is one of the recordkeepers, and wherein the selected one or more loan fund accounts arefunded with participant assets in one or more benefit plans for whichthe one record keeper provides record keeping services.

In further embodiment, the selection received from the one record keeperis for a second plurality of the loan fund accounts, and furthercomprising receiving a selection from one or more of the participantsassociated with the one record keeper of at least one of the secondplurality of loan fund accounts to invest loan fund assets associatedwith the one or more participants.

In further embodiment, the selecting entity is a benefit plan associatedwith one of the benefit plan accounts, and wherein the one or more loanfund accounts are funded with participant assets from the one benefitplan account.

In further embodiment, the selection received from the benefit plan isfor a second plurality of loan fund accounts, and further comprising:receiving a selection from one or more of the participants in the onebenefit plan account of at least one of the second plurality of loanfund accounts to invest loan fund assets associated with the one or moreparticipants.

In further embodiment, there are a plurality of different record keepersand a plurality of benefit plans accounts and further comprising:receiving a selection of a respective second plurality of the loan fundaccounts from each respective record keeper of the plurality ofdifferent record keepers, and funding or having funded the respectivesecond plurality of loan fund accounts selected by each different recordkeeper with participant assets associated with that respective recordkeeper.

In further embodiment, there are a plurality of different benefit planaccounts and further comprising: receiving a selection by each of theplurality of different benefit plan accounts of a respective secondplurality of loan fund accounts, and funding or having funded therespective second plurality of loan fund accounts selected by eachdifferent benefit plan account with participant assets associated withthat respective benefit plan account.

In further embodiment, the selecting entity is one of the participants.

In further embodiment, the selecting entity is one of the participantsand further comprising: receiving from the participant a selection of atleast two of the loan fund accounts to invest loan fund assetsassociated with the one participant.

In further embodiment, the steps are provided of receiving a selectionof a second plurality of loan fund accounts, wherein there are aplurality of benefit plan accounts, and aggregating the loan fund assetsassociated with the plurality of benefit plan accounts among the loanfund accounts in the second plurality of loan fund accounts.

In further embodiment, the selection received is for a second pluralityof loan fund accounts, and further comprising: aggregating the loan fundassets from the plurality of record keepers among the second pluralityof loan fund accounts.

In further embodiment, there are a plurality of the record keepers, andfurther comprising: maintaining each different loan fund account withone and only one record keeper.

In further embodiment, there are a plurality of the record keepers, andfurther comprising: maintaining for each of the different record keepersa separate account in each of a plurality of the loan fund accounts.

In further embodiment, there are a plurality of the benefit planaccounts, and further comprising: maintaining for each of the differentbenefit plan accounts an associated separate account in each of aplurality of the loan fund accounts.

In yet further embodiment, a computer system is provided forfacilitating provision of loans to a plurality of participants of one ormore benefit plan accounts associated with one or more record keepers,each participant having participant assets in one or more of the benefitplan accounts, each of the benefit plan accounts comprising a pluralityof investment vehicles, each of the one or more record keepers providingrecord keeping services for at least one of the benefit plan accounts,said computer system comprising: one or more processors; and one or morecomputer-readable memories operatively connected to one or moreprocessors, with computer program instructions capable of performingsteps comprising: administering a first plurality of loan fund accounts,each different loan fund account being associated with a respective oneor more of the benefit plan accounts, and funded by participant assetsof the respective associated one or more of the benefit plan accounts,referred to as loan fund assets, wherein funds may be drawn for loansfrom each of the different loan fund accounts, and wherein each of theloan fund accounts maintains both assets and debts; maintaining anassociation of each different one of the first plurality of loan fundaccounts with a different investment vehicle that is part of therespective one or more benefit plan accounts but segregated from otherinvestment vehicles in the respective one or more benefit plan accounts;receiving a selection from a selecting entity of one or more of the loanfund accounts from among the first plurality of loan fund accounts;investing or having invested or maintaining loan fund assets comprisingparticipant assets associated with the selecting entity in the one ormore respective different investment vehicles associated with the one ormore selected loan fund accounts; associating a respective loanaccounting process with each of the selected one or more loan fundaccounts, capable of processing multiple loan requests that are lessthan an asset balance in the loan fund account, wherein the loanaccounting process is different from one or more accounting processesassociated with the respective one or more benefit plans; receiving aloan-request comprising one or more participant loan requests to betaken from one or more of said loan fund accounts using accountinformation for said loan fund account stored in said computer-readablememory; initiating transfer of an amount of funds requested by saidloan-request from one or more of said loan fund accounts to service theloan-request; and updating said account information for said loan fundaccount to reflect said loan-request amount of funds transferred fromsaid loan fund account using the associated respective accountingprocess that computes a current balance of available funds in the loanfund account based on redemptions from the amount of assets in the loanfund account and payments to the amount of assets in the loan fundaccount and does not change a loan fund asset amount listed in theaccount information of the benefit plan account relating to the loanfund account for each redemption.

In yet further embodiment, a program product is provided comprising: acomputer readable medium having encoded program data capable of, whenexecuted, causing a computer to perform a method for facilitatingprovision of loans to a plurality of participants of one or more benefitplan accounts associated with one or more record keepers, eachparticipant having participant assets in one or more of the benefit planaccounts, each of the benefit plan accounts comprising a plurality ofinvestment vehicles, each of the one or more record keepers providingrecord keeping services for at least one of the benefit plan accounts,comprising the steps: administering a first plurality of loan fundaccounts, each different loan fund account being associated with arespective one or more of the benefit plan accounts, and funded byparticipant assets of the respective associated one or more of thebenefit plan accounts, referred to as loan fund assets, wherein fundsmay be drawn for loans from each of the different loan fund accounts,and wherein each of the loan fund accounts maintains both assets anddebts; maintaining an association of each different one of the firstplurality of loan fund accounts with a different investment vehicle thatis part of the respective one or more benefit plan accounts butsegregated from other investment vehicles in the respective one or morebenefit plan accounts; receiving a selection from a selecting entity ofone or more of the loan fund accounts from among the first plurality ofloan fund accounts; investing or having invested or maintaining loanfund assets comprising participant assets associated with the selectingentity in the one or more respective different investment vehiclesassociated with the one or more selected loan fund accounts; associatinga respective loan accounting process with each of the selected one ormore loan fund accounts, capable of processing multiple loan requeststhat are less than an asset balance in the loan fund account, whereinthe loan accounting process is different from one or more accountingprocesses associated with the respective one or more benefit plans;receiving a loan-request comprising one or more participant loanrequests to be taken from one or more of said loan fund accounts usingaccount information for said loan fund account; initiating transfer ofan amount of funds requested by said loan-request from one or more ofsaid loan fund accounts to service the loan-request; and updating bycomputer said account information for said loan fund account to reflectsaid loan-request amount of funds transferred from said loan fundaccount using the associated respective accounting process that computesa current balance of available funds in the loan fund account based onredemptions from the amount of assets in the loan fund account andpayments to the amount of assets in the loan fund account and does notchange a loan fund asset amount listed in the account information of thebenefit plan account relating to the loan fund account for eachredemption.

BRIEF DESCRIPTION OF THE FIGURES

The present invention may be understood more fully by reference to thefollowing detailed description of preferred embodiments, to illustrativeexamples of specific embodiments, and to the appended figures in which:

FIG. 1 illustrates a financial/legal structure used in a preferredembodiment of the present invention;

FIGS. 2A-B illustrate a system structure of a preferred embodiment ofthe present invention along with the information and monetary exchangeswithin the illustrated structure;

FIGS. 3A-B illustrate preferred repayment and redemption processes ofthe present invention;

FIGS. 4A-C illustrate preferred loan-authorization and setup methods ofthe present invention;

FIG. 5 illustrates a preferred computer system for performing softwarethat implements methods of the present invention;

FIG. 6 is a schematic diagram of an embodiment of the invention usingmultiple loan funds, each associated with a different investment vehicleor set of vehicles.

FIG. 7 is a schematic block diagram of a process and program code inaccordance with an embodiment of the invention using multiple loan fundaccounts.

DETAILED DESCRIPTION OF THE INVENTION

In the following, the term “participant” (or “plan participant”) refersto an employee-plan beneficiary (the plan perhaps providing retirementincome), or generally to a benefit-plan beneficiary. A participant maybe currently employed (i.e., an “employee”), between employment, orretired. The term ‘plan” refers to any employee-benefit plan meeting theexpectations of the invention as described above, and includes pensionplans, 401(k) plans, 403(b) plans, 457 plans, IRAs, Keough accounts, toname a few. The term “redemption” (or “loan redemption”, “advance”,“withdrawals”, “purchase”, “liquidation”, etc.) refers to aparticipant's use of assets segregated in a loan fund established by thepresent invention as payment in a transaction. The term “repayment” (or“repayment by a participant”) refers to a participant's loan repaymentof any redemptions made through the process of the present invention.

The term “interest” (when used in the context of interest onredemptions) refers to loan interest due from or paid by participants ontheir redemptions (that is, their loan principal). Participants thusrepay both redemptions and any interest on the redemptions.

The term “dividends” refers to earnings, if any, on balances in theparticipants' loan funds. Dividends are provided by the investmentvehicles in which the loan funds are invested.

The term “available loan amount” (ALA) refers to the maximum amount thatmay be used to finance redemptions determined in view of a participant'sbenefit-plan assets. Typically, the ALA varies with (e.g., as a fixedpercentage of) the vested benefit-plan assets.

The term “line of credit” (LOC) refers to the amount available tofinance current redemptions. Typically, the LOC varies with (e.g., isequal to) the current, unredeemed funds in a participant's loan fund.

Further, the term ‘access vehicle” refers generally to financial andprocedural mechanisms by which an individual may access for use fundsavailable in or through a demand deposit account, or a line of credit,or other financial instruments. Access vehicles include “traditionalaccess vehicles,” which may be, but are not limited to: checks, orelectronic checks, or credit cards, or smart cards, or debit cards, orwire transfers, or ACH services, or sweeps, or automatic teller machines(ATM), to name a few. Preferred access vehicles include automaticprocessing mechanisms (generally networked computer systems) that can beeasily interfaced to the systems of the present invention to accessparticipants' loan funds. (As one of skill in the art will appreciate,the present invention may interface to new access vehicles which arebeing developed or are yet to be developed.) However, the system andaccounts in embodiments of the invention are designed to be capable ofprocessing multiple redemptions by the participant during a givenperiod, with each of a plurality of the redemptions being for an amountthat is less than the available loan amount.

Described next are the general embodiments and accompanying advantageousfunctional features of the present invention. Described subsequently arethe legal and financial structures to which the present invention isapplicable, system structures of the present invention, and lastly themethods of the present invention.

General Embodiments and Functional Features

The present invention provides “loan funds” within employee-benefitplans, similar to plans authorized (in the U.S.) by 26 U.S.C. §§ 401(k),403(b), or 457, or similar to individual retirement accounts (IRA), orKeough accounts. These statutory plans are designed to accumulatefinancial assets to support, for example, participants' pension orretirement needs. Preferably, applicable plans also provide separateaccounts for each individual participant, each account holdingaccumulated assets that are invested according to at least partialparticipant control in various investment vehicles and including optionspermitting participants to borrow assets from their plan accounts.

The “loan fund” of the present invention makes conveniently available toparticipants redemptions funded by a portion of the participants'accumulated benefit-plan assets. Within individual participant accountsin an applicable benefit plans, according to the present invention,“loan-fund investments” (see, e.g., 5 in FIG. 1 and its subsequentdiscussion) are established and invested in appropriate “loan-fund”investment vehicles. The loan-fund investment vehicles are managed byone or more investment managers, preferably already established andexperienced investment managers, so that, primarily, the vehiclesmaintain high liquidity with substantially constant face value, andsecondarily, so that the vehicle earns reasonable dividends consistentwith the primary goals of the benefit plan. In the U.S., “money-market”funds may serve as appropriate loan-fund investment vehicles, althoughother investment vehicles with reasonable liquidity may also serve assuch vehicles. Other possible investment vehicles include bank demanddeposits, or certificates of deposit, or certain stocks, or bonds, ormutual funds, or so forth.

The present invention then provides administrative systems which areresponsible for managing and directing the transfers of funds in and outof the participants' loan funds and for establishment and maintenance ofloan funds. The value of a participant's loan-fund investment recordedin the benefit plan changes as the balance in that participant's loanfund (loan fund accounts receivable for outstanding loans to theparticipant plus loan funds invested in the loan fund investmentvehicles) changes. The benefit-plan loan-fund-investment value furtherincreases as interest and dividends are accrued to the benefit plan. Inorder that a participant can access assets from their individual loanfund, this invention's administrative systems interface, on one hand, toestablished payment systems (e.g., the Visa® or MASTERCARD® networks orcheck clearinghouse (ACH)).

On the other hand, these administrative systems interface withestablished benefit/pension plan management systems, which are oftendivided functionally and perhaps physically, into a record-keeperfunction (or system) and a plan-management function (or system; in theU.S., typically a trust company monitors plan assets). Specifically, theprovided administrative systems are designed to interface withrecord-keeper functions in order to frequently (for example, daily orweekly or monthly) update the benefit plan with the current value of theparticipants' loan-fund investments. This interface is preferablysubstantially similar to the record-keepers' interface with otherinvestment systems managing other investments present in participantaccounts. The actual loan-fund administrative management function (orsystems) of this invention need only interact with the existingbenefit-plan administrative systems (i.e., record-keeper systems) when aparticipant decides to make, change, or terminate investments in theloan funds, an interaction consistent with the interactions the planmanagement function has with other investment-management systems.

In operation, the administrative systems of the present invention drawcash assets from a participant's loan fund to cover redemptions, and addcash assets to a loan fund when the participant repays outstanding loans(or redemptions). Therefore, cash assets remain in a participant's loanfund earning dividends, until the very moment they are lent out to theparticipant. The unused amounts remaining in the loan fund continue toprovide dividend income to the participant's plan account, while theparticipant pays interest on the cash redemptions actually withdrawnfrom the loan fund.

Moreover, it is preferable that the administrative systems manageparticipants' loan funds so that amounts in the loan funds whetherredeemed to the participant or still available for loan (that is “oncall”), as well as interest paid on redemptions and dividend incomeearned on the on-call amount, continue to have the advantages of thebenefit plan. Thus loan-fund assets are maintained within the benefitplan under favorable advantages by the individual participant untilactually borrowed (redeemed), and upon borrowing, are replaced by loanreceivables due from the participant. Thus, interest paid and redemptionrepayments receive similar advantages. The administrative systems of thecurrent invention also enable participants' outstanding loans to be‘portable,’ thus eliminating the need for participants to pay offoutstanding loans upon employment termination. Accordingly, wheninformation is received by the system indicating an employmenttermination of the participant, the system in one embodiment may recordthat information in its database, but does not send out a noticerequiring repayment of outstanding loans.

Briefly, a participant's maximum available loan amount is typicallylimited by statute, regulation, and perhaps also by plan policy to acertain percentage of the vested value in the participant's benefit-planaccount. The loan fund is preferably structured as a sub-custodian (or asub-trust) (operating similarly to a self directed brokerage account) ofthe benefit-plan, which is often legally structured as a trust. Thesystems and methods of the present invention then manage processes forsettlement of participant redemptions and acceptance of participantrepayments so that the advantages of the benefit plan flow to the loanfund as an investment within the plan.

Accordingly, the loan funds provided by the present invention are asubstantial improvement over current benefit-plan loan processes, andalso are significantly more economical then traditional unsecuredpersonal borrowing, such as bank credit card loans. Because the presentinvention provides loan access related to the value of the establishedloan fund, borrowing costs are dramatically reduced below typical bankcards. In fact, the interest paid by the participant on loans madepossible by this invention (and dividends earned by the loan fund) iscredited to the participant's own benefit-plan account. Neglectingexpenses, loan interest paid becomes retirement savings. Further,because the present invention increases the accessibility and liquidityof participant assets saved in benefit plans, increased participation inand contribution to benefit plans are likely.

In other words, the present invention enables the participant tomaintain the funds within the loan fund investment vehicle until themoment needed. The interest charged the participant for the financingredemptions benefits the participant, therefore creating an alternativeform of daily transactional financing that reduces the overall cost offunding needs of the participant and enables substantial cost savingsover traditional credit card financing, especially, but not exclusively,for low to middle income plan participants that do not have access toalternative low cost forms of credit (i.e. home equity financing).

In addition to these financial advantages, the structure of theadministrative systems of the present invention provides additional andsignificant process and procedural advantages. As described, theadministrative systems separate routine (often, daily) use of aparticipant's cash resources (or cash-equivalent or other liquid assets)in their loan fund from those exchanges and transfers supporting aparticipants longer term decisions (typically, monthly or even yearly)on asset allocation within the overall benefit plan account, includingthe size of loan fund to make available for redemptions from theparticipant's benefit-plan account.

Advantageously, the invention interfaces high frequency (for example,daily or even hourly) exchanges and transfers only to establishedpayment systems, which are designed to handle high-volume, standardizedtransactions. It limits exchanges and transfers with benefit-plansystems to those of lower frequency (for example, monthly or yearly),which result from participant investment decisions. Establishedbenefit-plan systems (specifically, record-keeping systems) are alreadydesigned to handle these lower-frequency investment-decision driventransactions.

Some embodiment of this structure allow the invention to provide theloan funds in the context of established and functioning financialsystems while requiring, at most, minimal modifications to theseexisting systems. From the point of view of these existing system,little impediment to implementation of the loan funds of the presentinvention is apparent. Additionally, benefit-plan processing costs formanaging this invention's loan fund are reduced in comparison toexisting loan plans, because implementation of this invention does notsubstantially burden the processing already performed by currentbenefit-plan systems, the type of processing for which they have beendesigned. These cost savings may be passed on to a plan sponsor (such asan employer) and could be an incentive for the adoption of the presentinvention, ultimately increasing participation in benefit plans.

Further, the administrative systems preferably provide for participants'enhanced access, for example, by means of the phone or Internet andstandard web browsers, for rapidly creating loan plans, for funding ofand repayments to their loan plans, and for reporting on their balancesand transaction, availability and status information, electronicchecking and payment, and the like. This allows participants theprivileges and benefits of traditional access vehicles along withreal-time tracking and accessing of information via phone or Internet.

In more detail, the administrative systems of the present inventioninclude one or more data-processing systems mutually interconnected.This system processes programs that establish and maintain loan funds sothat regulatory funding, redemptions, repayments, and interest-ratecriteria (on outstanding redemptions) are met to support qualified loanbased transactions. These data-processing systems monitor a plurality ofloan-fund accounts, each associated with a single participant's plan,preferably for multiple employers, and perhaps, even for multiplejurisdictions. The system monitors and determines funding criteria foreach participant based on the available line of credit (LOC) valuederived from the loan-fund asset composition. The funding criteria areapplied to the access vehicles and are used to support redemptions madeto the respective plan participants. These loans (redemptions) arethereafter charged an interest rate based on market factors. The systemhandles the redemption process and the repayment process within theloan-fund system per established regulatory requirements, andimportantly, without burdening established benefit-plan systems with anew type of frequent transaction.

Specifically, the legal relationship of the loan funds to the benefitplan is preferably that of a sub-custodian to the benefit-plan trust. Inother embodiments, this relationship may be that of a sub-trustee, maybe contractual, and so forth.

DETAILED EMBODIMENTS

Described here are legal structures of the invention; describedsubsequently are system and methods of the invention.

Legal Structures of the Invention

FIG. 1 illustrates a preferred organizational and legal structure forthe invention. The ultimate beneficiaries of the invention, and of theassociated benefit plan, are a plurality of (at least one) participants1. Benefit plan 2 has a legally-recognized responsibility to theparticipants to properly manage their assets and benefits, and includesa plurality of (at least one) accounts 3, for each participantbeneficiary 1. Each account 3 includes at least one investment, and inthe majority of instances, a plurality of investments, typically 2-5, ofwhich the composition and asset allocation is at least partiallydirected by its associated participant beneficiary.

In U.S. embodiments, the benefit plan is usually structured as a legaltrust, which stands in a fiduciary relationship to the participants.

A plurality of loan funds 4 are added to the benefit-plan structure. Thebenefit plan has responsibility for a plurality of loan funds 5, oneloan fund for each participant who has chosen to participate in thisinvention. The elements added by this invention are indicated in FIG. 1by dashed outlines. The loan fund has a legal relationship to benefitplan 2 which maintains the correct administration of the loan fundsaccording to statutory and regulatory requirements and according to planpolicies and procedures (e.g., plan loan policies, privacy policies, andthe like). Generally, a participant taking advantage of this inventiondirects the benefit plan to transfer a part of their assets into theloan fund, so that from the point of view of the benefit plan, aparticipant's loan fund appears as an investment by the participant.Preferably, dividend income generated by the loan fund is accrued asinvestment income to the participant's benefit-plan account.

Benefit-Plan and Payment-System Structures

FIGS. 2A-B illustrate an embodiment of a system structure of theinvention. With reference first to FIG. 2A, to the right in this figureare the elements and systems usually found in established benefit plans,namely elements 10′-14. To the left in this figure are the elements andsystems usually found in established payment systems, namely elements10″ and 30-33. The participant appears twice in these figures, at 10′ asa beneficiary of the benefit plan and loan fund and at 10″ as a user ofa loan fund provided by the invention. The present invention addsprimarily elements 20-22 which collectively act to manage the loan fund.In U.S. embodiment, the loan fund is preferable structured as asub-custodian plan (similar to a self directed brokerage account) of thebenefit-plan trust. (In other embodiments, this invention mayincorporate some or all of the benefit plan and the payment systemfunctions. In particular, if the present invention is practiced by abank, issuing servicer function 23 may be conveniently practiced alongwith the invention's methods; if the invention is practiced by aninvestment manager, management functions 24 would naturally be practicedalong with this invention's methods.)

In FIG. 2A, solid arrows represent message communication. Alternatively,a batch of messages may be accumulated in a file and periodically(hourly, daily, or so forth) communicated as a file transfer. Further inFIG. 2A, all systems and message/file transfers have individualreference numerals. In turn, FIG. 2B illustrates funds transfers byhollow arrows (dashed, hollow arrows in FIG. 2A), all having individualreference numerals. Because identical systems and message/file transfers(dashed, solid arrows in FIG. 2B) appear in FIGS. 2A and 2B, forconvenience and clarity, only funds transfer have reference numerals inFIG. 2B.

Turning first to the right-hand systems usually found in establishedbenefit plans, trust administration systems 11 and plan record keeper 12perform overall management of the benefit plan, ensuring that the termsof the employers trust agreements (i.e., plan policies) are carried outin a manner consistent with statutory and regulatory requirements. Trustsystems 11 communicate, on one hand, with employer systems (notillustrated) receiving employee salary and contribution information, andon the other hand, with plan record keeper 12. Record keeping is alargely administrative activity conceptually separate from trustmanagement and often physically delegated to separate systems or even toseparate organizations. Administrative record-keeper systems 12, interalia: maintain plan database 13 including, at least, informationcharacterizing each plan participant's account including itsinvestments; receive instruction from and provide status information totrust administrator systems 11; receive requests from and provideaccount information to participants 10′; receive employee contributionsfrom employers (not shown); exchange funds with the managers of theparticipant investments (not shown); exchange funds with the investmentmanager component of this invention; and so forth.

For example, in the U.S., benefit plans are often services provided toemployers by mutual fund organizations, such as Fidelity, Vanguard, toname a few. In this case, although systems 11 and 12 and database 13 mayall be within the mutual fund organization (or an administrativesubsidiary of the mutual fund organization), they are typicallyimplemented by separate software systems optionally running on separatehardware server systems. Additionally in this case, because investmentsavailable to participants may be largely limited to the funds providedby the mutual fund organization, the investment manager systems may alsobe within the same organizational structure.

The left hand systems are those usually found in established paymentsystems that process access vehicles. Most access vehicles that theinvention interfaces to are “issued” by an issuing servicer, in the U.S.usually a bank, which processes and funds its issued access vehicles.When a payer uses an issued access vehicle in a transaction, thesettlement system for that vehicle ultimately returns a payment requestto the issuing servicer (or bank) for payment and presentation to payer.It is also common for the issuing service to authorize use of its issuedaccess vehicles at transaction time, for example, checking forsufficient payer funds (or that a line of credit will not be exceeded).Because the issuing servicer is thus the sub-custodian's portal to loanredemptions, the sub-custodian administration systems 20 must smoothlyinterface and closely cooperate with issuing servicer systems 23, asindicated by the dashed box enclosing these systems in FIGS. 2A-B.Indeed, in some embodiments of the invention, both systems may be partof related organizations. Further, in other embodiments, thesub-custodian administration system 20 may interface to more than oneissuing servicer so that loan-fund participants may have the convenienceof alternative access vehicles.

In more detail, on the loan redemption side, loan-fund participant 10″presents 34 one of the access vehicles provided by the loan fund topayee 30 in satisfaction of a transaction. Payee 30 then periodically(for example, daily) forwards a batch of access vehicles received intransactions to acquiring servicer 31, usually a bank, which acquiresthese vehicles from the payee and credits the payee's account with theirvalue (minus a fee). Servicer 31 then periodically (for example, alsodaily) forwards a batch of access vehicles received from its payees onto the appropriate settlement network (e.g., the MASTERCARD or the VISAnetworks) or clearing house system (e.g., the U.S. Federal Reserve Bankcheek clearing system) for payment. The settlement/clearing systems netthe access vehicles and forward to issuing servicer 23, also usually abank, a request for net payment (or other net transfer) along withrecords indicating which participant 10″ paid what amount to which payee30. Accordingly, issuing servicer 23 then orders 28 (or requests, bothusually by electronic communications) funds transfer from its settlementaccount 25 to settlement/clearing system 32.

On the loan repayment side, the sub-custodian administration system,after determining each plan participant's outstanding loan, calculatesthe next required minimum principal and interest payment (and anoptional full principal and interest payment), which it forwards 29 toparticipant 10′ (equivalently, 10″), optionally along with records ofthe participant's redemption transactions (for example, as a paper orelectronic statement). This calculation is performed at a selectedfrequency (weekly or monthly if a loan balance is outstanding) andaccording to selected rules so that all applicable statutory andregulatory mandates are met along with any more restrictive benefit-planpolicies. In response to payment requirements, participant 10″ forwardsrepayment instructions, typically, to a separate payment-handlingorganization, “lockbox” 33. A lockbox has delegated to it theresponsibility for receiving, forwarding, and appropriately applyingpayments, both for this invention as well as for other financial systemsin the usual case (i.e. it acts as a provider funds-acceptance service).Alternatively, the present invention could itself supply the lockbox (orfunds-acceptance) function, Administrator system 20 is informed(preferably by electronic communications) of a participant's payments,and updates the loan-fund records for the participant.

Turning to FIG. 2B to review the funds flow during redemptions andrepayments, first, settlement of loan redemptions for plan participants'results in net flow 44 of funds to settlement/clearing systems 32, whichthen in turn forward the funds to the correct acquiring servicers 45 forthe account of the various payees. Loan repayments begin withparticipant 10″ forwarding 42 funds to the designated lockbox 33, whichthen in turn forwards 43 them on to settlement account 25 of theinvention. The settlement account receives 41 settlement fundstransferred from a participant's loan fund; repayment funds areforwarded 41 for acceptance into and ultimate deposit 40 to theparticipants' loan-fund investment. (In this embodiment, the settlementaccount acts as a funds transfer buffer between the loan fund and theentities receiving or providing funds; in alternative embodiments, thesettlement account may not be needed, all funds flowing directly fromthe loan fund.)

One of skill will understand from this description and the appendedfigures how to adapt this invention to other payment systems.

Sub-Custodian System Structures

FIGS. 2A-B also illustrate the specific elements of an embodiment,elements 20, 21, and 22, and closely associated with those specificelements, elements 23, 24, and 25 (which may optionally be practicedalong with the methods of this invention), along with the associatedelectronic message/file exchanges and funds flows.

The sub-custodian administration system 20 plays a central role in theinvention, preferably implementing the methods described subsequently.It receives instructions 26 from benefit-plan record keeper 12 forestablishing loan-fund investments (maintained and managed by loan-fundinvestment management systems 24) and lines of credit (LOC) values for anew plan participant; provides 26 status information to record keeper 12including a participant's current account balances, outstanding loanredemptions, and available LOC; and receives further instructions 26 formodifying or terminating a participant's loan-fund investments.Loan-fund establishment includes, inter alia, initializing loan-fundinformation 22 in database 21, and accepting into the loan fund initialfunds transferred from the benefit plan. The instructions (equivalently,requests and responses) are preferably electronically transmittedbetween the various systems.

System 20 also provides orders to loan-fund investment management system24 to cause and monitor asset transfers from a participant's accountconsequent to loan redemptions from 41 a participant's loan-fundaccount, and also loan repayments accepted into 41 a participant'sloan-fund account, and also to cause and monitor funds transfers 40 withthe benefit plan. Transfers with the benefit plan occur consequent,inter alia, to initial funding of the loan fund, as well as consequentto subsequent funding changes occurring when participants designate more(but always less than the ALA value) or less of their benefit-planassets for investment in their loan funds 5 (FIG. 1). Final transfer toother investment vehicles in the benefit plan occurs when the loan fundis terminated.

Periodic transfers to benefit-plan accounts may also occur consequent tothe accrual of accumulated interest and dividends into the participants'benefit-plan accounts. Interest may be paid by participants on theiroutstanding redemptions (at, e.g., a market rate in order to maintainthe redemptions' advantages), and is received by the loan-fundinvestment management system 24 (directly or indirectly) from lockbox33. Dividends may be earned on (unredeemed) balances remaining in theloan funds, and is received by the loan-fund investment managementsystem from the investment vehicles in which the loan fund is invested.

These interest and dividend funds are preferably accumulated to theaccount of the participants at the loan-fund investment managementsystem, and are periodically transferred (“swept”) into the benefit plansystem 14, where participant benefit-plan assets are accordinglyupdated. If the transferred interest and dividends update thatparticipant's vested benefit-plan assets, the participant's ALA may beautomatically updated. (However, the participant's LOC will not beupdated unless the participant requests that some of all of these fundsbe invested in that participant's loan fund.)

In one embodiment, interest and dividend funds may be deposited directlyinto the participant loan fund by the loan-fund investment managementsystem, and the ALA and LOC values may then both be automaticallyupdated, assuming that such updates qualify under plan rules andgovernmental guidelines.

Additionally, system 20 interfaces closely with issuing servicer 23 (orthe equivalent financial institution) and indirectly (or directly)controls funds transfers through settlement account 25 (by electronicrequests and responses). Information received 27 from servicer 23includes transaction records of participants' loan redemptions,currently available LOC values, periodic requests for funds forsettlement of redemption transactions, and the like. Information sent 27to servicer 23 includes current maximum allowed LOC values, which inmost cases the servicer uses to authorize payments at transaction time(e.g., by comparing a requested redemption with the available LOC value.(The redemption is authorized if less than the LOC value and the LOCvalue is reduced by the redemption; the redemption is refused or notpermitted if greater than the LOC). Generally, the information exchangedis adapted to the needs of proper sub-custodian administration.

To perform these functions, the sub-custodian administrator system ofthe current invention maintains database 21 describing the loan fund andits participants. For each loan-fund participant, database 21 maintainsrecords 22 of loan-fund redemptions due to access vehicle transactions,loan-fund repayments, current balances inloan-fund-investment-management system 24, current amounts of thesebalances assigned to loan-fund redemptions (i.e., the participant'scurrent line of credit (LOC) values, available loan amounts (ALA)values), administrative information, historical audit information,accrued interest, dividends earned, and so forth.

The present invention includes the possibility that a participant maychose to invest in the loan-fund investment vehicles as well as use thisinvestment vehicle to provide for loan redemptions. In such anembodiment, the administrator system may also maintain the amount in theloan fund investment to be retained for investment purposes along withthe amount to be made available for loan redemptions (the sum of thesetwo amounts typically being the participant's total loan-fund inventionbalance).

Further, this database 21 preferably also includes administrativeinformation describing the loan funds supported along with systeminformation for operating and interfacing to the various computersystems illustrated in FIGS. 2A-B. In certain embodiments, because themethods and systems of this invention may serve employers in variousjurisdictions and benefit plans with various loan policies,administrative information includes information for performing loandeterminations, calculations, payments, reporting, and so forth, foreach plan, employer, and jurisdiction as needed. This information maybe, for example, represented as rules indexed by jurisdiction andbenefit plan and stored in the database. Whenever necessary, the methodsretrieve the appropriate rule in order to make a required determinationin accord with statute, regulation, and plan policy. In furtherembodiments where the invention interfaces to several separate paymentsystems, administrative information also advantageously includes paymentinterface rules preferably represented in similar fashions.

The messages exchanged illustrated in FIGS. 2A-B are described in Tables1 and 2 for an illustrative embodiment. Table 1 describes primarily thepurpose of the message, while Table 2 describes the message flow andcontents. In alternative embodiments, the information may be exchangedas individual message or batched into files of many messages.

TABLE 1 File/message Purpose Account file Directions from thetrustee/record keeper responsible for the plan to the sub-custodianresponsible for the loan- fund investment and for its use as an accessvehicle Maintenance Current status of the loan-fund investment from thereport sub-custodian Trust transfer Confirmation of fund transferbetween the plan trust completed file administrator and the loan-fundmanager Daily dividend Updates the sub-custodian (and its record keeper)with report the dividend income earned by the loan-fund account Accountstatus Instruction to access-vehicle servicer on maximum file creditallowed General ledger Instructions regarding settlement of redemptionsand (G/L) settlement repayments by the participant from their loan-fundreport account

TABLE 2 Exchanged between File/message (ref. No. in FIG. 2A) ContentsAccount file Plan record keeper Batch no.; ACNT; ID; → Sub-custodianAmount of credit line; SC admin. system (26) Maintenance Sub-custodianACNT; SSN; Amounts of— report admin. system → credit line, money marketplan record keeper balance, loan balance, total (26) dividends earned,total interest paid; total fees paid to plan (whether paid as interestto plan or fees); Date amounts as-of; SC Trust transfer Investmentmanager Batch No.; ACCNT; Amount completed file sys. → transferred; Datereceived sub-custodian admin. system (38) Daily dividend (same) ACNT;Amount of loan-fund report balance; Amount of dividend; Date amountsas-of Account status Sub-custodian ACNT; ID; Amount of credit fileadmin. system → line; SC issuing servicer (27) General ledger Loanadmin. system G/L accounting fields; (G/L) settlement → Sub-custodiansettlement transfer instructions; report admin Amount to transfer

In these tables, the “File/message” column provides a conventional namefor the information exchanged or for the file. Generally, theinformation is exchanged periodically (for example, daily) in the formof files of a batch messages accumulated during the day. The “Exchangedbetween” column provides the names of the entities exchanging the namedinformation along with the reference numeral in FIG. 2A of the exchange.The “Purpose” column generally describes why the information is beingexchanged.

Finally, the “Contents” column provides a summary of the messagecontents or the contents of each file record. The followingabbreviations are used in the Contents column: ID for participantidentifying information (ID) such as name, address, phone no., socialsecurity number (SSN), birth data, security key (ex., mother's maidenname); ACNT for participant account identifying information; SC foraction/status codes describing the account action the informationparameterizes, for example new account, credit line increase ordecrease, close account—employment termination, close account—death,close account—default, close account—plan termination; and batch numberfor identifying the actual file or message exchanged.

Implementation of the Invention's Systems

Sub-custodian administrator system 20 is preferably implemented with oneor more standard server-type computer systems. FIG. 5 illustrates anexemplary server-type system. Suitable systems include Intel-basedservers such as are widely available from, e.g., IBM, Dell,Hewlett-Packard, Compaq, to name a few. Suitable operating softwareincludes a Microsoft windows family system, such as Windows NT or XPserver, or a UNIX family system, such as Linux from Redhat. Database 21is preferably stored on attached disk storage and managed by Oracledatabase software, by IBM DB2 database software, and the like. Theserver systems are linked to general communication networks, such as theInternet, and to dedicated special-purpose financial networks, such asclearing networks, by communication interfaces.

The use of the term “computer system” (or of “system” where computersystem is understood) is meant to includes systems of one or morecooperating computers, each computer including one or more cooperatingprocessors and memories.

Functions and methods performed by the sub-custodian administratorsystems 20 may be programmed in a convenient language, for example Java,C++, C, or by means of an application generator. Programs are compiledto executable code (or interpreted), loaded into memory, and executed bythe processor. Executable programs may be stored on and loaded intomemory from computer-readable, removable media. These media includeoptical media, magnetic media; download from a server across a computernetwork, and the like as known in the art.

In an exemplary programming paradigm, known as an event-based paradigm,the programs may be structured as modules that process each incomingmessage or file, updating databases, and generating consequent requestmessages or files. Other modules may be periodically invoked to monitorand respond to changes in, e.g., participant status, funds levels, or soforth

Methods of the Inventions

Described herein with respect to FIGS. 3A-B are the participantrepayment and redemption processes of the present invention; and withrespect to FIGS. 4A-C, the processes for loan-fund application, set-up,and modification.

FIG. 3A illustrates an embodiment of the participant loan repaymentprocess of the present invention. Periodically, preferably monthly ormore frequently, for each loan-fund participant, the sub-custodianadministrator system 20 (also referred to in this subsection as the“administrator system” or the “administrator”) determines 51 the monthlyoutstanding loan amount, for example, by adding the sum of theparticipant's repayments minus participant's redemptions and interestdue on and fees charged to the previous outstanding loan amount. Theredemption and repayment information has been received from, forexample, the issuing servicer 23 and the lockbox system 33. Repaymentinformation is forwarded (28 in FIG. 2A) to the issuing servicer 23 fromthe lockbox system 33. Next, the administrator system 20 determines 52minimum principal and interest payments due from the participantaccording to the regulations applicable in the jurisdiction of thebenefit plan (for example, in the U.S. from 26 U.S.C. § 72), and formatsand distributes 53 the participant's monthly statement preferablylisting transactions, amounts due, and loan-fund balances, and the like.Distribution may be by mail, or by on-line electronic means, or soforth.

Next, the participant pays 54 at least the minimum amounts due oroptionally up to the entire loan balance. Repayments are received 55 bythe lockbox system 33 and forwarded 56 to the system settlement account25 with a payment report forwarded 57 to the issuing servicer (and thenon to the administrator).

Lastly, the administrator system orders the transfer of funds 58 fromthe settlement account and acceptance 25 into the loan-fund investmentmanager system (24 in FIG. 2A) for the accounts of the participants.Concurrently, the administrator 20 may update 59 in its database (21 inFIG. 2A) participant records with current loan-fund balance data,outstanding redemptions, and corresponding current LOC value. The LOCvalue is also forwarded to the issuing servicer 23 so that it mayproperly authorize transactions for the participants.

Next, FIG. 3B illustrates an embodiment of the access vehicle redemptionprocess. Periodically, preferably daily (or at another frequencydetermined by the characteristics of particular access vehicles andtheir processing systems), the redemption process starts with theadministrator system 20 determining 61 total redemptions for eachparticipant. The redemptions are, for example, determined from the sumof all the participant's transaction amounts for that period forwarded62 from the issuing servicer 23. (Alternatively, the issuing servicermay receive and send net redemption information from the settlementnetwork, supplemented by any “own” redemptions (a transaction in whichthe issuing servicer also acquires the transaction).) It is the issuingservicer 23 that interfaces directly with the particular paymentsystems, and authorizes transactions and receives completed transactioninformation. The administrator 20 then updates the current loan-fundbalance 63 and the current LOC value 64 by, e.g., subtractingredemptions from their previous values. Optionally (not illustrated),the administrator system may also add to these values repayments of bothprinciple and interest received during the period. The administrator maythen post or have posted the updated line of credit (LOC) online for useby Visa or Mastercard or other credit card systems or ACH, oralternatively, have a direct connection to update the LOC in thosesystems.

Next, the issuing servicer 23 receives 64 the new LOC value so that itmay properly authorize transactions during the next period. Theadministrator also orders the loan-fund investment manager system 24 totransfer net funds 66 from the loan fund to the settlement account 25from the accounts of the participants. Finally, the settlement accountforwards funds 67 to the settlement/clearing systems 32 for the variousaccess vehicles; these systems then internally distribute funds tosatisfy payees.

From FIGS. 3A-B it can be appreciated that the sub-custodianadministrator system has no necessary interactions with the benefit-plansystems during cash redemptions or repayments by the participant; theseactivities occur between the administrator system 20, the establishedpayment systems, and the investment manager for the participantloan-fund accounts. At most, the sub-custodian administrator 20 mayupdate the benefit-plan record-keeper system with information, for eachparticipant, concerning loan-fund balances and their asset composition,interest paid, dividends earned, fees charged, and so forth. Thisupdate, and other reporting, is according to the sub-custodian'sfiduciary responsibilities to the plan. The benefit-plan systems neednot necessarily be concerned about individual participant transactions,either for information purposes or for processing purposes unless theychoose to do so.

Further embodiments of the processes of loan-fund application, set-up,and modification are described with reference to FIGS. 4A-C. Theseprocesses are illustrated in a preferred Web-based implementation (usingHTML formatted “pages”) directed to 401(k) plans; alternativeembodiments may be implemented using paper forms or use other inputmeans or access other forms of benefit plans associated with the loanfund. Many of the first steps illustrated in these figures arepreferably implemented by the plan record-keeper system (12 in FIG. 2A)(or other benefit-plan system) because they relate to the benefit planin general or to the benefit-plan's responsibility to approve employeeloan applications. Certain steps that relate primarily to loan-fundadministration are carried out by the sub-custodian administrationsystem upon request by the trust record keeper.

First, a participant/prospective participant (participant) logs 70 intothe employer benefit systems and accesses 71 a benefits administrationpage, which preferably presents a menu of possible benefits for furtherexamination including the 401(k) loan fund of this invention. Asillustrated, the participant selects an option to establish the 401(k)loan fund 72 of the invention. If the employee is already a 401(k) planparticipant, tested at 78, the system presents 74 the 401(k) loanadministration logon page. If the participant is not already enrolled,the system inquires 79 whether the employee wishes to join the employer401(k) benefit plan. If this is the case, the participant is presentedwith an on-line registration process beginning at registration 80. Ifthe participant does not want to establish a loan fund, then the systemallows them to perform other benefit processing 81 and log out.

Optionally, as illustrated, the 401(k) loan fund haslogin/authentication 75 in addition to the general login/authenticationof the main employee-benefits system. If login is successful, tested at76, the participant is then presented with the actual 401(k) loan-fundcreation page 76. If not, the participant is permitted a number ofadditional login attempts. Loan-fund creation/administration 73 alsopreferably presents a menu of loan-fund options, including application,modification, queries concerning current fund status and balances, andthe like. In subsequent figures actions relating to plan application andmanagement are illustrated. Plan queries may be routinely implementedwith data returned from database 21.

If plan application or modification is selected, the participant is nextpresented with an application or modification detail 77, which maypreferably have certain fields, such as participant identificationfields in the case of plan application or plan description and statusfields in the case of modification, already filled in with informationknown to the record-keeper system. The participant next enters relevantinformation 77 and submits 85 to the record-keeper system for datavalidation and consistency checking 86. In the case of incorrect data87, the participant is prompted 88 to reenter and resubmit correct data.Correct data is passed to record keeper and trust management systems forprocessing 89.

Processing of a loan application 90 (equivalently, an application tojoin the loan-fund benefit option of the 401(k) plan) jointly by thetrust record-keeper systems and the sub-custodian administrator systemsof the loan plan is illustrated in FIG. 4C. First, the available loanamount (ALA) value is determined 100 by the record-keeper system. Inmost cases, the ALA value depends on the vested value of theparticipant's 401(k) account. Here, database 101 illustrates anexemplary account with several investments. The vested value of theseinvestments is determined by plan vesting rules and the current marketvalues of the investments.

If the participant's requested loan-fund amount (entered in theapplication page) is equal to or less than the determined ALA value 102,application processing proceeds. If not, the participant is prompted 103to re-enter a loan-fund amount that is equal to or less then the ALAvalue provided.

Once an acceptable request has been negotiated with the participant, aninvestment is created in their benefit-plan account, which is describedherein as the loan fund, and is funded, in one embodiment, by thetransfer of assets from previous existing investments within the plan,or in another embodiment, by the transfer of funds from outside the planinto the loan fund. In database 105, this is indicated by the exemplaryrecord with the “investment—loan fund.” For example, this record wouldresult from record-keeper processing of the input account recordillustrated in database 101. Assets for acceptance into the loan fundare next provided from the benefit plan to the loan-fund investmentmanagement system (24 in FIG. 2A), which carries out actual investmentmanagement of the loan-fund accounts (seeking reasonable dividend incomeconsistent with high liquidity and preservation of value). If sufficientcash is not available, fractions of pre-existing investments areliquidated (investments 1−N) and are redeemed 107 and the fundsforwarded (40 in FIG. 2B) by the record keeper to the loan-fund manager.At this time, the record keeper also instructs the sub-custodianadministrator systems (20 in FIG. 2A) to make necessary preparations forthe new loan-fund account, for example, by initializing a databaserecord describing the new participant and the parameters of theassociated loan fund, notifying the access vehicles selected by theparticipant, initializing issuing servicer systems (23 in FIG. 2A) to beready to process participant transactions, and so forth.

In other words, for each participant benefit-plan account, an ALA valueis calculated from their current vested interest in the pension plan andlimitations, if any, imposed by statute or regulation or by policies ofthe benefit-plan sponsor. In view of the determined ALA value, aparticipant then selects a value for investment in the loan fund to beestablished, or for modifications to an already established loan fund.If the entire value of the ALA is invested in the loan fund, then thevalue invested in the loan fund is necessarily equal to the ALA value.

Returning to FIG. 4B, in the case the participant requests modificationof an already existing loan-fund account 78, the data entry andvalidation steps 85, 86, 87, and 88 are performed to validate andconsistency check the submitted request. Test 90 and 91 directmodification to steps 92 and 93, which are an abbreviated representationof this processing. Preliminary to 92, negotiation steps, notillustrated but similar to steps 100, 102, and 103 of FIG. 4C, maynegotiate with the participant to achieve an acceptable request. Next,the record keeper processes 92 the modification request and providesinstructions to the sub-custodian administrator systems to do likewise.As a result of the modification request funds may need to be transferred93 (40 in FIG. 2B) between the loan-fund investment manager (upon therequest of the sub-custodian administrator systems) and the trust (uponrequest/approval of the trust systems). For example, funds may betransferred from the trust if the participant requests an increasedinvestment in the loan fund; funds may be transferred to the trust ifthe participant requests a reduced investment in or even totalliquidation of the loan fund and reallocation of its assets to otherinvestments in the benefit plan.

From FIGS. 4A-C it can be appreciated that substantial interaction andcooperation, including funds transfer, between the sub-custodianadministrator systems 20, and other closely associated systems, and thetrust record-keeper systems 12, and other trust systems, is needed onlywhen the participant makes macro loan-fund investment decisions. Suchloan-fund investment decisions, like most plan investment decisions, areexpected to be relatively infrequent (more likely monthly or a few timesper year). Further, during these interactions the plan systems of thisinvention appear to the trust systems largely as just an additionalparticipant investment, managed and reported in already establishedmanners. Accordingly, fashioning this interface is relativelyinexpensive, requiring little modification of existing trust orrecord-keeper systems. Further, the present invention of the loan fundimposes no additional processing burden on the existing trust systems.

It has been discovered that by operating at the record keeper and/orbenefit plan level, embodiments of the invention realize specialsynergies of aggregation that allow reaching thresholds to permit theselection and use of particular desirable investment vehicles.Additionally, by divorcing the redemption/repayment operations from thebenefit plan or plans and aggregating loan fund account assets fromlarge numbers of participants, it has been discovered that multiple loanfund accounts, each invested in a different investment vehicle, can beadministered, thereby allowing benefit plans to offer their participantsloan fund account investing options to facilitate complex investmentstrategies.

Referring to FIG. 6, multiple record keepers 600 and 602 areillustrated. These record keepers function, in one embodiment, providerecord keeping services for one or more benefit plan accounts and theirrespective participants. In FIG. 6, record keeper A maintains recordsfor benefit plan account A1, benefit plan account A2, benefit planaccount A3, and benefit plan account A4. Likewise, record keeper Bmaintains investments and records for benefit plan account B1, benefitplan account B2, benefit plan account B3, and benefit plan account B4.Each different one of these benefit plan accounts would, in oneembodiment, be associated with a respective different employer or otherplan sponsor. In one embodiment, the benefit plan account comprises apension fund for employees of an employer. The participants in thebenefit plan account would have participant assets in typically one, butpotentially multiple of the benefit plan accounts.

FIG. 6 further shows a computer system 606 for maintaining andadministering a first plurality of loan fund accounts 610, 612 and 614.Each of these loan fund accounts is designed to process a plurality ofloan requests, each loan request for less than or equal to the fullamount of funds in loan fund account. Note that it is understood by oneof ordinary skill in the art that there are multiple accountingprocesses that operate on these accounts. However, in the presentinvention, a redemption/repayment accounting process is associated witheach of the loan fund accounts and comprises the day-to-day accountingprocess that computes the current balance of available funds in the loanfund account based on the redemptions from and payments to the assets inthe loan fund account, per the claim language, so that a loan fund assetamount listed in the account information of the benefit plan accountrelating to the loan fund account is not changed. This operation isreflected in block 700 in FIG. 7. Each different loan fund account 610,612, and 614 is associated with a respective one or more of the benefitplan accounts, and is funded by participant assets of the respectiveparticipants associated with the one or more of the benefit planaccounts A1-A4 and B1-B4. These participant assets used to fund thedifferent respective loan fund accounts are referred to as loan fundassets. These loan fund assets may be drawn for loans from each of thedifferent loan fund accounts 610, 612 and 614, and each of the loan fundaccounts are capable of maintaining both assets and debts. The operationof administering comprises processing redemptions and credits made byparticipants against the loan fund assets, calculating a current balanceof available funds and computing accumulated interest on the loan fundassets.

Note that the assets for the respective loan fund accounts, in oneembodiment, would be obtained by one or more participants in arespective benefit plan designating selected funds to be used for theone or more loan fund accounts. This money from a plurality of theparticipants of a given benefit plan account would then be aggregatedand invested or directed to be invested in the designated one or moreloan fund accounts.

The computer system 606 further maintains an association of eachdifferent one of the first plurality of loan fund accounts 610, 612 and614 with a respective different investment vehicle 620, 622 and 624.This operation is reflected in block 710 in FIG. 7. Each investmentvehicle is a part of a respective one or more benefit plan accounts butis segregated from other investment vehicles in the respective one ormore benefit plan accounts. For example, loan fund assets for the loanfund account 620 could be invested in a money market fund which containsonly participant assets designated for the loan fund account. Loan fundassets for the loan fund account 622 could be invested in a specifiedmutual fund which contains only participant assets designated for thatloan fund account 622. Likewise, loan fund assets for the loan fundaccount 624 could be invested in a bank demand deposit account whichcontains only participant assets designated for the loan fund account624.

In operation, the computer would receive a selection from a selectingentity of one or more of the loan fund accounts from among the firstplurality of loan fund accounts 620, 622, and 624. This operation isreflected in block 720 in FIG. 7. In one embodiment, the selectingentity is a record keeper. In this embodiment, each Record Keeper(Record Keeper A, Record Keeper B, etc.) is provided electronically oron paper with an option to use more than one loan fund account (LoanFund Account 620, Loan Fund Account 622, Loan Fund Account 624, etc.),each of which is associated with and invested in a different investmentvehicle, as per the example above. In a further related embodiment, theselecting entity is a benefit plan account. In this embodiment, eachBenefit Plan Account (Benefit Plan Account A1, Benefit Plan Account A2,. . . ) using the services of a given Record Keeper (Record Keeper A)may be further provided electronically or on paper with an option to usemore than one loan fund account (Loan Fund Account 620, Loan FundAccount 622, Loan Fund Account 624, etc.). In a still further relatedembodiment, the selecting entity is a participant. In this embodiment,each participant (Participant A1-1, Participant A1-2, . . . ) of aBenefit Plan Account (e.g., Benefit Plan Account A1) is provided with anoption to select from more than one loan fund account (Loan Fund AccountA1, Loan Fund Account A2, etc.) as the investment vehicle in which theloan fund assets are invested. In one embodiment, an individual benefitplan account participant will have all of its individual loan fundassets in a single Loan Fund Account. However, in an alternativeembodiment, an individual plan participant would be capable ofdesignating its loan fund assets to be split among multiple Loan FundAccounts associated and invested in different investment vehicles orcombinations of investment vehicles.

In a further embodiment, a selection could be received from a recordkeeper of a second plurality of the loan fund accounts, for example, aselection of loan fund accounts 610 and 614, but not loan fund account612. This selected second plurality of loan fund accounts would then bemade available by the benefit plan account or its plan sponsor to itsparticipants, who could then choose one or more of the second pluralityto use. Thus, a selection could be received directly or indirectly fromone or more of the participants associated with the one record keeper ofat least one of the second plurality of loan fund accounts to investloan fund assets of the one or more participants.

In a further embodiment, a selection could be received from a benefitplan account or its plan sponsor of a second plurality of the loan fundaccounts, for example, a selection of loan fund accounts 610 and 614,but not loan fund account 612. This selected second plurality of loanfund accounts would then be made available by the benefit plan accountor its plan sponsor to its participants, who could then choose one ormore of the second plurality to use. Thus, a selection could be receiveddirectly or indirectly from one or more of the participants associatedwith the benefit plan account of at least one of the second plurality ofloan fund accounts to invest loan fund assets of the one or moreparticipants.

A further step or function in the operation is investing or havinginvested or maintaining loan fund assets comprising the participantassets associated with the selecting entity in the one or morerespective different investment vehicles associated with the one or moreloan fund accounts selected by the selecting entity. As noted, theselecting entity could be a record keeper, a benefit plan account, orone or more participants. In the case of a record keeper, the loan fundaccount would be funded with participant assets designated for the loanfund account in one or more benefit plans for which the one recordkeeper provides record keeping services that have been designated byparticipants for the loan fund account. In the case of a benefit planaccount, the loan fund would be funded with participant assets from thatbenefit plan account that have been designated by participants for theloan fund account. Where the selecting entity is one or moreparticipants, the loan fund account would be funded with designatedassets from the one or more participants. This accumulation ofparticipant assets would comprises the loan fund assets for providingloans. The investing operation is reflected in block 730 in FIG. 7.

The operation of block 730 could comprise a direct investment in theinvestment vehicle associated with the selected loan fund account.Alternatively, the operation could comprise providing instructions forthe investment of the loan fund assets in the investment vehicleassociated with the selected loan fund account. Alternatively, theoperation could comprise the administration of the investment vehicle.The method of investing is not limiting on the invention. The operationscould be performed electronically via electronic instructions andelectronic deposit of funds to the particular investment vehicle, or itcould be performed manually via paper transactions or a combinationthereof.

A further step or function in the operation is associating a respectiveloan accounting process with each of the selected one or more loan fundaccounts, that is capable of processing multiple loan requests foramounts that are less than an asset balance in the loan fund account,wherein the loan accounting process is different from one or moreaccounting processes associated with the respective one or more benefitplans. This operation is reflected in block 740 in FIG. 7. Such anaccounting process may be implemented in the computer 606 and wouldencompass processing the individual debits and credits to be applied tothe loan fund account so that the loan fund asset amount listed in theaccount information of the benefit plan account relating to the loanfund account does not change after each redemption. Note that this stepmay encompass a single instance of an accounting process performing theprocessing operations for all of the loan fund accounts, and also theassociation of a different instance of the accounting process to beassociated with each different loan fund account.

A further step or function in the operation, as reflected in block 750of FIG. 7, is receiving a loan-request comprising one or moreparticipant loan requests to be taken from one or more of the loan fundaccounts using account information for the loan fund account stored in acomputer-readable memory accessible by the computer 606, the accountinformation for the loan fund account being preferably stored by thecomputer system separately from account information for the benefit planaccount. Note that the loan request may be from a single individual.Alternatively, the loan request may comprise an aggregation of loan fundaccount requests and credits from the various participants that havebeen aggregated by the computer 606 over a period of time, e.g., a fourhour period, a 12 hour period, a one day period, for example.

A further step or operation might comprise comparing the amount of theloan-request to a current balance of available funds for the particularparticipant, and approving the loan-request if the amount requested isless than or equal to a current balance of available funds for theparticular participant, and denying the loan-request if it is greaterthan the current balance of available funds.

A further step or operation comprises initiating transfer of an amountof funds requested by the loan-request from one or more of the loan fundaccounts to service the loan-request. This operation is reflected inblock 760 in FIG. 7. In one embodiment, this would comprise sending anelectronic request to a holder of the funds for the loan fund account toinitiate the transfer based on the amount in the loan request. In adifferent embodiment, this could be accomplished by a paper transaction.Note that in one embodiment an order of transfer could be designated bythe participant or the benefit plan or service provider, so that fundsare first transferred from a first designated loan fund up to a limit,and then from a second designated loan fund up to a limit, etc.

A further step or operation is provided of updating the accountinformation for the loan fund account that may be separately stored fromaccount information for the benefit plan account to reflect theloan-request amount of funds transferred from the loan fund accountusing the associated respective accounting process that computes acurrent balance of available funds in the loan fund account based onredemptions from and credits/payments to the amount of assets in theloan fund account, but does not change a loan fund asset amount listedin the account information of the benefit plan account relating to theloan fund account for every redemption. This operation is reflected inblock 770 in FIG. 7. Note that on a periodic or other basis, the loanfund asset amount listed in the account information of the benefit planaccount relating to the loan fund account may be changed to reflectadditions to the loan fund account due to accumulated interest earnings,or due to the transfer of funds from the loan fund account to anotherinvestment vehicle in the benefit plan account not associated with theloan fund account.

In a further embodiment, each Record Keeper (Record Keeper A, RecordKeeper B, etc.) has a separate account for a given Loan Fund Account,(for example, for loan fund account 1, Record Keeper A could have LoanFund Account A1 and Record Keeper B could have Loan Fund Account B1,etc.). The individual plan participants funds could still be aggregatedin each loan fund account, either aggregated by Benefit Plan Accountand/or by Record Keeper.

From the above it can also be seen that in one embodiment, each of aplurality of benefit plan accounts may have selected a second pluralityof loan fund accounts or for which a selection has been received ontheir behalf for a given second plurality of loan fund accounts. In thiscase, the assets designated for the loan fund accounts by participantsof the respective benefit plan accounts are aggregated among the secondloan fund accounts.

Additionally, it can also be seen that in a further embodiment, each ofa plurality of record keepers may have selected a second plurality ofloan fund accounts or for which a selection has been received on theirbehalf for a given second plurality of loan fund accounts. In this case,the assets designated for the loan fund accounts by participantsassociated with the respective record keepers are aggregated among thesecond loan fund accounts.

In a further embodiment, there are a plurality of the record keepers,and each different loan fund account is associated with one and only onerecord keeper.

In a yet further embodiment, there are a plurality of the recordkeepers, and each of the different record keepers has an associatedseparate account in each of a plurality of the loan fund accounts.

In a further embodiment, there are a plurality of the benefit planaccounts, and each different loan fund account is associated with oneand only one benefit plan account.

In yet a further embodiment, there are a plurality of the benefit planaccounts, and each of the different benefit plan accounts has anassociated separate account in each of a plurality of the loan fundaccount.

It should be noted that although the flow charts provided herein show aspecific order of method steps, it is understood that the order of thesesteps may differ from what is depicted. Also two or more steps may beperformed concurrently or with partial concurrence. Such variation willdepend on the software and hardware systems chosen and on designerchoice. It is understood that all such variations are within the scopeof the invention. Likewise, software and web implementations of thepresent invention could be accomplished with standard programmingtechniques with rule based logic and other logic to accomplish thevarious database searching steps, correlation steps, comparison stepsand decision steps. It should also be noted that the word “component” asused herein and in the claims is intended to encompass implementationsusing one or more lines of software code, and/or hardwareimplementations, and/or manual operations.

While this invention has been described in conjunction with theexemplary embodiments outlined above, it is evident that manyalternatives, modifications and variations will be apparent to thoseskilled in the art. Accordingly, the exemplary embodiments of theinvention, as set forth above, are intended to be illustrative, notlimiting. Various changes may be made without departing from the spiritand scope of the invention.

What is claimed is:
 1. A loan management data processing computer systemfor interacting via respective communication interfaces for electroniccommunications with one or more record keeper computer systemsassociated with respective recorder keepers to administer loans to aplurality of participants of one or more employee benefit plansassociated with one of the respective record keepers, said loanmanagement data processing computer system comprising: one or morecomputers; and one or more computer-readable storage media operativelyconnected to one or more processors in the one or more computers,comprising computer program instructions configured for causing, whenexecuted, the one or more computers to perform steps comprising: (A)accessing, by the one or more computers, in the performance of one ormore of the following steps, one or more electronic databasescomprising: (1) aggregated investment account information for a firstplurality of aggregated investment accounts, each different aggregatedinvestment account associated with a respective one or more of theemployee benefit plans and comprising funds of a plurality of individualparticipant asset-funded loan fund accounts, each of the individualparticipant asset-funded loan fund accounts being associated with one ormore of the employee benefit plans, each of the different aggregatedinvestment accounts associated with a different one or morecash-equivalent investment vehicles; (2) participant asset-funded loanfund account information for a plurality of participants, theparticipant asset-funded loan fund account information for a respectiveparticipant of the plurality of participants comprising informationindicating one or more participant asset-funded loan fund accounts eachcomprising a respective asset balance held in one or more of theaggregated investment accounts, wherein each participant asset-fundedloan fund account is defined as an account which is separate from arespective core investment account of the respective participant'semployee benefit plan account and is funded by assets segregated by theparticipant asset-funded loan fund account from the respective coreinvestment account of the respective participant's employee benefit planaccount, and wherein the participant asset-funded loan fund accountinformation includes at least: (i) first participant asset-funded loanfund account information indicating a first participant asset-fundedloan fund account (a) having a first account balance, (b) associatedwith a first aggregated investment account, (c) associated with a firstindividual participant associated with a first employee benefit planaccount, and (d) funded by a first core investment account of the firstemployee benefit plan account, the first core investment account beingassociated with the first individual participant; (ii) secondparticipant asset-funded loan fund account information indicating asecond participant asset-funded loan fund account (a) having a secondaccount balance, (b) associated with a second aggregated investmentaccount, (c) associated with a second individual participant associatedwith the first employee benefit plan account, and (d) funded by a secondcore investment account of the first employee benefit plan account, thesecond core investment account being associated with the secondindividual participant; and (B) obtaining in real-time, by the one ormore computers from a third individual participant associated with thefirst employee benefit plan, directly or through one of the one or morerecord keeper computer systems, selection information identifying aselection of the first aggregated investment account from among thefirst plurality of aggregated investment accounts by: (1) providing inreal-time, via the respective communication interfaces for electroniccommunications, machine-readable instructions to a remote computingdevice associated with the third individual participant to render inreal-time a loan selection graphical user interface, the loan selectiongraphical user interface comprising one or more selection options eachcorresponding to one of the first plurality of aggregated investmentaccounts; and (2) receiving in real-time, by the one or more computersvia the respective communication interfaces for electroniccommunications, the selection of the first aggregated investment by thethird individual participant through selecting a corresponding one ofthe selection options in the loan selection graphical user interface atthe remote computing device; (C) obtaining, by the one or morecomputers, an electronic indication of an initial amount of fundsassociated with the selection of the first aggregated investmentaccount; (D) creating and storing electronically, by the one or morecomputers based at least in part upon the selection information, thirdparticipant asset-funded loan fund account information comprising athird participant asset-funded loan fund account associated with thefirst aggregated investment account and further associated with thethird individual participant by initializing, in the one or moreelectronic databases storing participant asset-funded loan fund accountinformation, the third participant asset-funded loan fund accountinformation; (E) recording, by the one or more computers in the one ormore electronic databases storing participant asset-funded loan fundaccount information, a third account balance from an electronic transferof the initial amount of funds from a third core investment account ofthe first employee benefit plan account to the third participantasset-funded loan fund account, the third core investment account beingassociated with the third individual participant and the third accountbalance being associated with the third participant asset-funded loanfund account; (F) associating electronically, by the one or morecomputers, a loan accounting process with the third participantasset-funded loan fund account for processing redemption data comprisingone or more debits and repayment data comprising one or more credits,wherein the loan accounting process is different from one or morebenefit accounting processes associated with the first employee benefitplan and wherein the loan accounting process comprises computing abalance of available funds in the third participant asset-funded loanfund account based at least in part upon the redemption data or therepayment data; (G) for each of the individual participant asset-fundedloan fund accounts of each individual participant that is electronicallyassociated with one of the aggregated investment accounts, investing inthe one aggregated investment account, by the one or more computers,funds of the respective individual participant asset-funded loan fundaccount with funds of other individual participant asset-funded loanfund accounts of other of the participants to form an aggregation offunds of the individual participant asset-funded loan fund accounts,wherein first funds of the first participant asset-funded loan fundaccount and third funds of the third participant asset-funded loan fundaccount are invested together in the first aggregated investmentaccount; (H) receiving, at the one or more computers, access vehicleredemption data associated with one or more access vehicles selectedfrom the group of a check, a credit card, a debit card, an ACH transfer,a wire transfer, a sweep, and an ATM, for one or more redemptions forthe third individual participant; (I) generating, by the one or morecomputers, transfer data in response to receipt of the access vehicleredemption data for transferring one or more amounts of funds from thethird participant asset-funded loan fund account to service the one ormore redemptions; and (J) determining, by the one or more computersusing the loan accounting process, for the third individual participantfor which redemption data was received, an update of the third accountbalance for the third participant asset-funded loan fund account basedat least in part on the transfer data and/or the redemption dataassociated with the third individual participant; wherein the loanmanagement data processing computer system interfaces with existingrecord keeper computer systems via respective communication interfacesto enable respective individual participants including the thirdindividual participant to create, maintain, or manage respective loanfund accounts using assets from respective core investment accounts ofan employee benefit plan and wherein respective funds of the respectiveloan fund accounts are invested in one or more respective aggregatedinvestment accounts selected by the respective individual participantsfrom the first plurality of aggregated investment accounts.
 2. Thecomputer system of claim 1, wherein the selection received from the onerecord keeper is for a second plurality of the aggregated investmentaccounts which second plurality is less than the first plurality, andwherein the computer system comprises a computer program instructionstored on the one or more computer-readable storage media for causing,when executed, the one or more computers to perform a step of receivingor obtaining from the record keeper computer system second selectioninformation associated with a fourth individual participant associatedwith the record keeper computer system, the second selection informationidentifying a second selection from one of the participants associatedwith the one record keeper of at least one of a second plurality ofaggregated investment accounts to invest loan fund assets associatedwith one or more individual participant asset-funded loan fund accountsassociated with the fourth individual participant, wherein the secondplurality of aggregated investment accounts is less than the firstplurality of aggregated investment accounts.
 3. The computer system ofclaim 1, wherein the computer system is further configured to interactvia respective communication interfaces with one or more employeebenefit plan computer systems associated with one or more employeebenefit plans.
 4. The computer system of claim 3, wherein the computersystem comprises a computer program instruction stored on the one ormore computer-readable storage media for causing, when executed, the oneor more computers to perform a step of obtaining, from a first employeebenefit plan computer system of the one of the one or more employeebenefit plan computer systems, second selection information associatedwith a fourth individual participant associated with the first employeebenefit plan, the second selection information identifying a secondselection of at least one of a second plurality of aggregated investmentaccounts to invest loan fund assets associated with one or moreindividual participant asset-funded loan fund accounts associated withthe fourth individual participant, wherein the second plurality ofaggregated investment accounts is less than the first plurality ofaggregated investment accounts.
 5. The computer system of claim 3,wherein there are a plurality of different record keepers and aplurality of employee benefit plans and the computer system furthercomprising comprises: a computer program instruction stored on the oneor more computer-readable storage media for causing, when executed, theone or more computers to perform a step of obtaining a selection of arespective second plurality of the aggregated investment accounts fromeach respective record keeper computer system of the one or more recordkeeper computer systems, wherein one or more of the respective secondpluralities are less than the first plurality; and a computer programinstruction stored on the one or more computer-readable storage mediafor causing, when executed, the one or more computers to perform a stepof facilitating funding the respective second plurality of theaggregated investment accounts selected by each different record keeperwith participant assets associated with that respective record keeper.6. The computer system of claim 1, wherein the loan management dataprocessing computer system is further configured to interact viarespective communication interfaces with at least some of the pluralityof participants, and the computer system further comprises a computerprogram instruction stored on the one or more computer-readable storagemedia for causing, when executed, the one or more computers to perform astep of obtaining from one of the plurality of participants a selectionof at least two of the first plurality of aggregated investmentaccounts.
 7. The computer system of claim 1, wherein the selectioninformation obtained is for a second plurality of aggregated investmentaccounts which second plurality is less than the first plurality,wherein there are a plurality of record keepers, and further comprisingthe computer system comprising a computer program instruction stored onthe one or more computer-readable storage media for causing, whenexecuted, the one or more computers to perform a step of facilitatingdistribution of the loan fund assets associated with the plurality ofrecord keepers among the second plurality of aggregated investmentaccounts.
 8. The computer system of claim 1, wherein there are aplurality of the record keepers, and the computer system furthercomprises a computer program instruction stored on the one or morecomputer-readable storage media for causing, when executed, the one ormore computers to perform a step of maintaining each differentaggregated investment account with one and only one record keeper. 9.The computer system of claim 1, wherein there are a plurality of therecord keepers, and the computer system further comprises a computerprogram instruction stored on the one or more computer-readable storagemedia for causing, when executed, the one or more computers to perform astep of maintaining for each of the different record keepers a separatesub-account in each of a plurality of the aggregated investmentaccounts.
 10. The computer system of claim 1, wherein there are aplurality of the employee benefit plans, and the computer system furthercomprises a computer program instruction stored on the one or morecomputer-readable storage media for causing, when executed, the one ormore computers to perform a step of maintaining for each of thedifferent employee benefit plans an associated separate sub-account ineach of a plurality of the aggregated investment accounts.
 11. Thecomputer system of claim 1, further comprising computer code foraccessing and communicating with a check clearinghouse network.
 12. Thesystem of claim 1, wherein the first core investment account, the secondcore investment account, and the third core investment account are thesame account.
 13. The system of claim 1, wherein the first coreinvestment account and the second core investment account are the sameaccount and the third core investment account is a different account.14. The system of claim 1, wherein the first core investment account andthe third core investment account are the same account and the secondcore investment account is a different account.
 15. The system of claim1, wherein the second core investment account and the third coreinvestment account are the same account and the first core investmentaccount is a different account.
 16. A method for administering loans toa plurality of participants of one or more employee benefit plansassociated with one or more record keepers by interacting via respectivecommunication interfaces for electronic communications with one or morerecord keeper computer systems, comprising: (A) accessing, by a loanmanagement data processing computer system comprising one or morecomputers, in the performance of one or more of the following steps, oneor more electronic databases comprising: (1) aggregated investmentaccount information for a first plurality of aggregated investmentaccounts, each different aggregated investment account associated with arespective one or more of the employee benefit plans and comprisingfunds of a plurality of individual participant asset-funded loan fundaccounts, each of the individual participant asset-funded loan fundaccounts being associated with one or more of the employee benefitplans, each of the different aggregated investment accounts associatedwith a different one or more cash-equivalent investment vehicles; (2)participant asset-funded loan fund account information for a pluralityof participants, the participant asset-funded loan fund accountinformation for a respective participant of the plurality ofparticipants comprising information indicating one or more participantasset-funded loan fund accounts each comprising a respective assetbalance held in one or more of the aggregated investment accounts,wherein each participant asset-funded loan fund account is defined as anaccount which is separate from a respective core investment account ofthe respective participant's employee benefit plan account and is fundedby assets segregated by the participant asset-funded loan fund accountfrom the respective core investment account of the respectiveparticipant's employee benefit plan account, and wherein the participantasset-funded loan fund account information includes at least: (i) firstparticipant asset-funded loan fund account information indicating afirst participant asset-funded loan fund account (a) having a firstaccount balance, (b) associated with a first aggregated investmentaccount, (c) associated with a first individual participant associatedwith a first employee benefit plan account, and (d) funded by a firstcore investment account of the first employee benefit plan account, thefirst core investment account being associated with the first individualparticipant; (ii) second participant asset-funded loan fund accountinformation indicating a second participant asset-funded loan fundaccount (a) having a second account balance, (b) associated with asecond aggregated investment account, (c) associated with a secondindividual participant associated with the first employee benefit planaccount, and (d) funded by a second core investment account of the firstemployee benefit plan account, the second core investment account beingassociated with the second individual participant; and (B) obtaining inreal-time, by the one or more computers, from a third individualparticipant associated with the first employee benefit plan, directly orthrough one of the one or more record keeper computer systems, selectioninformation identifying a selection of the first aggregated investmentaccount from among the first plurality of aggregated investment accountsby: (1) providing in real-time, via the respective communicationinterfaces for electronic communications, machine-readable instructionsto a remote computing device associated with the third individualparticipant to render in real-time a loan selection graphical userinterface, the loan selection graphical user interface comprising one ormore selection options each corresponding to one of the first pluralityof aggregated investment accounts; and (2) receiving in real-time, bythe one or more computers via the respective communication interfacesfor electronic communications, the selection of the first aggregatedinvestment by the third individual participant through selecting acorresponding one of the selection options in the loan selectiongraphical user interface at the remote computing device; (C) obtaining,by the one or more computers, an electronic indication of an initialamount of funds associated with the selection of the first aggregatedinvestment account; (D) creating and storing electronically, by the oneor more computers based at least in part upon the selection information,third participant asset-funded loan fund account information comprisinga third participant asset-funded loan fund account associated with thefirst aggregated investment account and further associated with thethird individual participant by initializing, in the one or moreelectronic databases storing participant asset-funded loan fund accountinformation, the third participant asset-funded loan fund accountinformation; (E) recording, by the one or more computers in the one ormore electronic databases storing participant asset-funded loan fundaccount information, a third account balance from an electronic transferof the initial amount of funds from a third core investment account ofthe first employee benefit plan account to the third participantasset-funded loan fund account, the third core investment account beingassociated with the third individual participant and the third accountbalance being associated with the third participant asset-funded loanfund account; (F) associating electronically, by the one or morecomputers, a loan accounting process with the third participantasset-funded loan fund account for processing redemption data comprisingone or more debits and repayment data comprising one or more credits,wherein the loan accounting process is different from one or morebenefit accounting processes associated with the first employee benefitplan and wherein the loan accounting process comprises computing abalance of available funds in the third participant asset-funded loanfund account based at least in part upon the redemption data or therepayment data; (G) for each of the individual participant asset-fundedloan fund accounts of each individual participant that is electronicallyassociated with one of the aggregated investment accounts, investing inthe one aggregated investment account, by the one or more computers,funds of the respective individual participant asset-funded loan fundaccount with funds of other individual participant asset-funded loanfund accounts of other of the participants to form an aggregation offunds of the individual participant asset-funded loan fund accounts,wherein first funds of the first participant asset-funded loan fundaccount and third funds of the third participant asset-funded loan fundaccount are invested together in the first aggregated investmentaccount; (H) receiving, at the one or more computers, access vehicleredemption data associated with one or more access vehicles selectedfrom the group of a check, a credit card, a debit card, an ACH transfer,a wire transfer, a sweep, and an ATM, for one or more redemptions forthe third individual participant; (I) generating, by the one or morecomputers, transfer data in response to receipt of the access vehicleredemption data for transferring one or more amounts from the thirdparticipant asset-funded loan fund account to service the one or moreredemptions; and (J) determining, by the one or more computers using theloan accounting process, for the third individual participant for whichredemption data was received, an update of the third account balance forthe third participant asset-funded loan fund account based at least inpart on the transfer data and/or the redemption data associated with thethird individual participant; wherein the loan management dataprocessing computer system interfaces with existing record keepercomputer systems via respective communication interfaces to enablerespective individual participants including the third individualparticipant to create, maintain, or manage respective loan fund accountsusing assets from respective core investment accounts of an employeebenefit plan and wherein respective funds of the respective loan fundaccounts are invested in one or more respective aggregated investmentaccounts selected by the respective individual participants from thefirst plurality of aggregated investment accounts.
 17. The method ofclaim 16, further comprising: obtaining, from the record keeper computersystem, second selection information associated with a fourth individualparticipant associated with the record keeper computer system, thesecond selection information identifying a second selection from one ofthe participants associated with the one record keeper of at least oneof a second plurality of aggregated investment accounts to invest loanfund assets associated with one or more individual participantasset-funded loan fund accounts associated with the fourth individualparticipant, wherein the second plurality of aggregated investmentaccounts is less than the first plurality of aggregated investmentaccounts.
 18. The method of claim 16, wherein the loan management dataprocessing computer system is further configured to interact viarespective communication interfaces with one or more employee benefitplan computer systems associated with one or more employee benefitplans.
 19. The method of claim 18, further comprising: obtaining, from afirst employee benefit plan computer system of the one of the one ormore employee benefit plan computer systems, second selectioninformation associated with a fourth individual participant associatedwith the first employee benefit plan, the second selection informationidentifying a second selection of at least one of second plurality ofaggregated investment accounts to invest loan fund assets associatedwith one or more individual participant asset-funded loan fund accountsassociated with the fourth individual participant, wherein the secondplurality of aggregated investment accounts is less than the firstplurality of aggregated investment accounts.
 20. The method of claim 18,wherein there are a plurality of different record keepers and aplurality of employee benefit plans and the method further comprises:obtaining a selection of a respective second plurality of the aggregatedinvestment accounts from each respective record keeper computer systemof the one or more record keeper computer systems, wherein one or moreof the respective second pluralities are less than the first plurality;and facilitating funding, by the one or more computers, the respectivesecond plurality of the aggregated investment accounts selected by eachdifferent record keeper with participant assets associated with thatrespective record keeper.
 21. The method of claim 16, wherein the loanmanagement data processing computer system is further configured tointeract via respective communication interfaces with at least some ofthe plurality of participants, and the method further comprisesobtaining, by the one or more computers from one of the plurality ofparticipants a selection of at least two of the first plurality ofaggregated investment accounts.
 22. The method of claim 16, wherein theselection information obtained is for a second plurality of aggregatedinvestment accounts which second plurality is less than the firstplurality, wherein there are a plurality of record keepers, and furthercomprising facilitating distribution, by the one or more computers, ofthe loan fund assets associated with the plurality of record keepersamong the second plurality of aggregated investment accounts.
 23. Themethod of claim 16, wherein there are a plurality of the record keepers,and the method further comprises maintaining, by the one or morecomputers, each different aggregated investment account with one andonly one record keeper.
 24. The method of claim 16, wherein there are aplurality of the record keepers, and the method further comprisesmaintaining for each of the different record keepers, by the one or morecomputers, a separate sub-account in each of a plurality of theaggregated investment accounts.
 25. The method of claim 16, whereinthere are a plurality of the employee benefit plans, and the methodfurther comprises maintaining for each of the different employee benefitplans, by the one or more computers, an associated separate sub-accountin each of a plurality of the aggregated investment accounts.
 26. Themethod of claim 16, further comprising accessing and communicating, bythe one or more computers, with a check clearinghouse network.
 27. Thesystem of claim 16, wherein the first core investment account, thesecond core investment account, and the third core investment accountare the same account.
 28. The system of claim 16, wherein the first coreinvestment account and the second core investment account are the sameaccount and the third core investment account is a different account.